Form of promissory notes and bills of exchange
Produced in partnership with Ed Bellamy, Marta Bishop and Jad Hussain of Paul Hastings (Europe) LLP

The following Banking & Finance practice note produced in partnership with Ed Bellamy, Marta Bishop and Jad Hussain of Paul Hastings (Europe) LLP provides comprehensive and up to date legal information covering:

  • Form of promissory notes and bills of exchange
  • Form of promissory notes and bills of exchange
  • Form of bills of exchange—overview
  • Bills of exchange: ‘an unconditional order’
  • Bills of exchange: ‘in writing’
  • Bills of exchange: ‘addressed by one person to another’
  • Bills of exchange: ‘signed by the person giving it’
  • Bills of exchange: ‘requiring the person to whom it is addressed’
  • Bills of exchange: ‘to pay on demand or at a fixed or determinable future time’
  • Payable on demand
  • More...

Form of promissory notes and bills of exchange

Form of promissory notes and bills of exchange

A bill of exchange is a paper instrument that is used to transfer money from one person to another instead of the transfer of the actual money itself.

A promissory note is a specific form of a bill of exchange with the essential difference being that a promissory note is a promise by the maker to pay whereas an ‘ordinary’ bill of exchange is an order to someone else to pay.

Bills of exchange generally, and promissory notes specifically, are governed by the Bills of Exchange Act 1882 (BEA 1882).

This Practice Note considers the form that bills of exchange and promissory notes are required to take under BEA 1882 and otherwise.

For information about the structure and parties involved in bills of exchange and promissory notes, see Practice Notes:

  1. Bills of exchange—structure and parties, and

  2. Promissory notes—structure and parties

Form of bills of exchange—overview

As noted above bills of exchange, including their required form, are governed by BEA 1882 which codified the some 2,500 common law cases as to such instruments.

One of the key functions of BEA 1882 was to enable bills of exchange to be transferable by formalising the negotiability of bills of exchange by ensuring that a holder could receive good title to a bill of exchange even if there were a number

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